Although you have probably never heard of this company, chances are you use its technology every single day.

Do you watch television, or use a computer? Have you bought an iPad or iPhone? Do you use a cell phone, digital camera or a GPS navigation system in your car? If so, then you’re most likely using what this company makes.

Yet, despite the wide-ranging use of this company’s products and the continuing proliferation of new devices that use them, this company’s stock price has been stuck in the doldrums. But that could change soon…

Taiwan-based semiconductor company Himax Technologies, Inc. (Nasdaq: HIMX) is one of the world’s primary makers of chips used in flat-panel display monitors. These chips are critical components used for large screens like TVs and computers as well as small screens such as those used for Apple’s (Nasdaq: AAPL) iPhone, digital cameras and GPS navigation systems.

Himax sells its chips to the biggest and best in the business. Clients include Taiwan-based Chimei Innolux, the world’s largest manufacturer of LCD monitors. Also among major clients for large and medium screens is Samsung Electronics (OTC: SSNLF.PK), the world’s largest flat-panel TV manufacturer, and TPV Technology, the world’s largest LCD TV maker. Clients that make small screens include Wintek, Apple’s touch-screen manufacturer for the iPad and iPhone.

One would think that business should be booming as the recovery is gaining steam, but that hasn’t been the case. Revenue in the first nine months of the year is actually lower than the year ago period by 2%, totaling $501 million. Earnings per share (EPS) have fallen from $0.15 per share in the same period last year to $0.12. In the third quarter, revenue has plunged 32% from the year ago quarter. As a result, the stock is down 28% in the past year, compared with a 15% gain for the S&P 500.

What’s going on?
The reason is simple. Demand for flat screen TVs is decreasing. It’s decreasing because people in the United States and Europe have passed the rapid growth stage of upgrading to HD flat-screen digital TVs — just about everyone has one already. The demand explosion that took place earlier this decade has run its course.

People are still buying TVs, but at a slower rate. In the first three quarters of 2010, global TV shipment growth slowed to 17%, from 26% in the year ago period. In the third quarter, sales of large panel display drivers at Himax fell 48% from the year ago quarter.

But here’s the good news: the stock price already reflects the recent disappointing sales and there are still several strong catalysts for growth going forward…

The Chinese market
In addition to a growing middle class and increasing domestic consumption in China, the country will move to a digital TV standard by 2015. In the United States, the move to digital helped created a boom in the HD TV market. Currently only about 17% of Chinese homes with cable use digital, so there is potential growth of hundreds of millions of consumers in this market.

3-D
Himax recently launched a 2-D to 3-D conversion solution used in large screens that the company says has been widely praised as offering the best 3-D effect in the marketplace. While 3-D TVs have not taken off yet, they could see strong growth in the years ahead.

Small screens
Global proliferation of handsets with display screens is increasing demand for the chip used in small and medium-sized display screens. This segment of the company’s revenue grew 11.8% in the third quarter and now contributes more than one quarter of revenue.

In addition, Himax is in stellar financial shape, with just $44 million in debt and $392 million in shareholder’s equity and $80 million in cash as of its most recent filing (Sept. 30). The company is well-prepared to service increasing demand going forward through expansions and acquisitions.

And then there’s the dividend. Despite the fact that Himax is an emerging-market technology company, it steps out of character by using its superior financial condition to pay a fat dividend. Dividends are paid once a year, and the company’s 2010 payment of $0.25 per share gives the stock a whopping trailing yield of about 12%.

Action to Take –> The strong growth trends in Himax’s business may take several quarters or more to come to fruition. However, given the current low price and the fact that the stock pays a double digit yield while you wait, it is a good buy at the current price.